A. H. Belo Corporation Announces Sale of the Former South Plant and Updates on Pension and Cash Taxes
A. H. Belo Corporation (NYSE:AHC) announced today that the Company closed on the sale of its former South Plant facility. Net proceeds were $6.7 million and the Company will record a gain on this sale in the fourth quarter of approximately $1.9 million.
The Company also determined it will make a $20 million voluntary payment to its pension plans prior to the end of 2014. This contribution will serve to continue to improve the unfunded position of the pension plans as well as to reduce the Company’s 2014 cash taxes, as pension contributions are tax deductible.
In other efforts to de-risk the pension plans, in the fourth quarter the Company completed a second lump sum payment offer to certain pension plan participants. A total of 721 participants accepted this lump sum offer which is expected to reduce the pension benefit obligation by approximately $70 million. The Company estimates it will record approximately $7.6 million of additional non-cash pension expense in the fourth quarter due to the recognition of prior year actuarial losses associated with the liquidated pension obligations. The pension plans will pay approximately $55 million to those participants accepting the lump sum offer. As a result of both of these actions, the Company does not expect to make any required pension contributions in 2015.
Based on current projections, including the sale of the South Plant and the voluntary pension contribution, the Company expects to pay approximately $6 to $8 million in federal and state cash taxes for 2014. The estimated payments will be made in December 2014.
About A. H. Belo Corporation
A. H. Belo Corporation (NYSE: AHC) is a leading local news and information publishing company with commercial printing, distribution and direct mail capabilities, as well as businesses with expertise in emerging media and digital marketing. With a continued focus on extending our media platform, we are able to deliver news and information in innovative ways to new audiences with diverse interests and lifestyles. For additional information, visit ahbelo.com, email email@example.com.